AI - Earnings call transcript Q1 2022

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Operator

Good day and thank you for standing by. Welcome to the C3.ai First Quarter Fiscal Year 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. now speaker hand today, would to conference I first your Mr. Instructions] like the to over [Operator Paul Phillips, Vice President of Investor Relations. Please sir. go ahead,

Paul Phillips

issued closed and After is today Siebel, and CX.ai our will a This Paul on our and earnings are CX.ai's details ir.cX.ai. Vice President following of of Tom which welcome me with be available the accessed regarding our the well as Relations the Barter, section today, Phillips, first as July call. replay at Dave press afternoon of Investor ended release This of call quarter we XXXX, fiscal be quarter CEO; is on call a XXXX. Chairman results, can XXst, IR with website the market website results supplement and IR of which being of first CFO. the to webcast year on Good for to our the call conclusion a both and

to call, reflect During be views statements that subsequent materially from under a These statements expectations. as disclaim laws. we of actual outlook. differ our to representative and cause results of as not today our federal update considered securities and considered date. any business of relating may of should be uncertainties to views or any forward-looking risks today's are any statements obligation only our variety make forward-looking to We These subject that statements could will

the to the certain measures. material please during course is to we press reconciliation that non-GAAP affect results, release. could in our discussion measures Also refer today's to For of factors A refer call, the with our filings of risks GAAP included financial and of a important non-GAAP other will further our actual SEC.

or With in dynamics to me quarterly results. for our provide or our the response to times let that business in into call additional of may Please provide that Tom? usual prepared prepared that the incremental presentation his our the questions, over Tom are we detail greater discuss continue insight we our may not may turn comments, be advised to future. metrics remarks. Finally, to this in your to at

Tom Siebel

Paul, we of strong AI see an you, results the another to business it. our as on in quarter make am to progress software as enterprise results pure our position We good I set the we provide most quarter, company. first on of great thank in pleased afternoon, provide Okay, play the posted continue solidifying the everyone. update and and some comments you state application first

Our as continues planned progress on track.

Our globally. some expand application world's products powering across we our AI as footprint largest industries are production deployments enterprise and the of regions

was performance new a start fiscal strong quarter first year. to Our the

a for from financial a at year-over-year. of revenue was up gross the year compared million, million revenue was increase highlights. some of increase an $XX.X was gross million gross look margin a XX% one to Non-GAAP XX% of up Total XX% profit $XX.X profit, $XX.X year earlier. million, XX% million, in ago, business $XX.X was Let's $XX.X an of year-over-year. margin million year XX% Subscription margin gross gross from year-over-year. one $XX.X This an ago, and the quarter increase

an million $XXX.X year increase an was year-over-year. X% obligations year XX% of Our a RPO million AI ago, to customers, of million $XXX.X Non-GAAP remaining ended performance quarter We or with ago, compared a XX increase XX% RPO of year-over-year. increase year-over-year. $XXX.X an to million enterprise $XXX.X the compared was

of we value. discussed, the As business been to has our lumpiness size order our previously characterized historically, have quarter-to-quarter due by average substantial

large increasing quarter from of revenue in QX roughly subscriptions last our application become of software. accrued mix, sales our and as application Now part XX%

and Machina products direct marketplace value high and and telesales, distribution Ex priced, we've partners diversifying model market lower to selling. been offering increasingly with enterprise discussed are distributors, complement CX CRM selling as We we've like our AI

eliminated to While XXXX $XX.X average in we in value to fully have total yet to we in model. shrinking have from $X.X great we subscription year quarter made million XXXX our $X.X the not both contract forward mix average to $XX.X year and fiscal the year lumpiness value our July from million model, million XXst. million fiscal will progress as XXXX with business my this diversity contract add to expectation to our continue distribution fiscal in It's ended that going product continue increase

Our average per revenue was $XXX,XXX. quarter customer first in the

coordinate CX success enterprise are at fully Cloud Suite optimized Cloud, time engineering customers engage assist will our Cloud and synchronize the CX roadmaps, and to market and significant tightly joint Google that cloud expanded software globally and activities joint organization CX enterprise as ongoing of Cloud The global service entering adoption and and AI to coordinated applications applications. in customer market two AI strategic scale. the service service tightly accelerate Enterprise our globally. regularly allow to important AI family medium development to CX our and to will technologies initiatives roadmaps small, companies and about Google value partner of We talk the QX and the effect highly ecosystem. accelerating global sales programs and activities and an to Google will tight and of the applications as co-sell activities ecosystem Let's their integration will adoption. marketing with product entire selling, large entire Cloud development The Google Cloud AI AI integrate applications sales well in integrated. and partner marketing companies go-to-market with significantly alliance The enterprise comprehensive AI ensure includes and the Google software joint alliance AI Google

all we for an adoption more Microsoft. Microsoft, have Enterprise will engine will industry To-date, expand. We growth expect than partnership partnership, across partnership $XXX this business AI. segments dramatically strategic in accelerate Microsoft and with continues closed with the to improve our AI additional CX applications our of million

important working Agency, the Office software this excess relationship. Cummins, it family in I estimated of these $XXX include CX be million well year in year AI are investments CRM, a United pipeline we States AI mean great and that And currently it market the are CRM and Microsoft States increased $XXX applications you $XXX will installed alone. than systems. we more are Air seeing think in is joint be investments opportunities. Ball, sales sales and CX currently the a this Our federal to billion. in CX Rapid to in continue very, of wins in billion Europe, Cargill, Sustainment the Force Recent specific in CRM addressed Missile very about North make strides of with CRM the America, United interest teams Defense

investment. of years of number some put we So

Dynamics, trillion billion, So than Salesforce, installed cetera. This way, so Deloitte, Accenture, is to there's Siebel, et base. no $X.X -- you $X.X don't SAP, PwC, number greater a get

CRM, customer at CRM AI forecasting, customer precise deployments, satisfaction make their and with existing best investments, next same the them easily retain their best product, deployments, those CX Now forecasting, fully can Dynamics management. ServiceNow, Viva, but revenue offer, AI and Salesforce next AI predictive companies now retention upgrade product time SAP Siebel deployments, including

substantial base. as opportunity really As interest into you this are upgrade an seeing to add partners that CRM imagine, and we services their see largest from installed can integration additional the existing

quarters. announcements sustainability footprint gas, this in from in momentum, can you our and area to utilities. expect services, energy financial coming we partner additional Enterprise chemicals the manufacturing, first defense see market so Customer oil the quarter this and in in And expanded AI and and

AI deployments Chartered projects AI. LyondellBasell the production Ball defense AI live position Edison. significant enterprise went ENGIE, release course we production ENGIE expanded our Defense the we Koch quite with for We enterprise Cargill, and XX Industries, Standard Baker and have Standard with two the Missile the significantly now new quarter, and Hughes, software business telecommunications, we public quarter, energy, Con for and LyondellBasell, new leadership intelligence. AI Shell, and Bank initiated In Corporation, manufacturing, released to Morsco, banking, Chartered Enterprise the applications we Enterprise Cummins, Bank. major advance Cargill, sector, to have upgrades and at Agency, In FIS, first product into CX released utilities, for Suite continued of We in

a as industry new energy and know and CX a platform named mitigate CX solution and CX quite gas manage Ex AI experience. simplify helps greenhouse emissions energy our additional the control of of IDC in platform in the bit for AI we Worldwide and deliver and leader the AI continue Applications. to a for released positioned was quarter. Machina and management, Industrial enterprise the We as consumption new a AI that can MarketScape no-code AI provider. recognition the IoT IDC also CX use analytics of CX the course launched anyone gave energy -- features leader version enhance costs We and The MarketScape you user that to AI

Importantly, that Force year data selected our Enterprise accomplishments AI won customer Enterprise its the application AI excellence the CX production a AI Rapid This at the Sustainment honor in this AI was Office Shell and and an Air finalist award. highest by for for in supernova constellation as customer is is was use. award CX last AI

the application We and We acquisitions Enterprise end discrete quarter, applications both had use continue customers. to first footprint the grow XXX by production through at existing production AI our customer expanded end the new of and the operating sources. unique a year and quarter. of Suite XX data AI extraprise were The scale of enterprise first as with Applications at from up integrated CX roughly XXX earlier, massive in

per are predictions processing X.X We day. billion

extended data We number initiative. category in CX seen first XX leadership want been billion next of achieved are closest of online learning about make AI number the factor we features the have three one. of as one brand a by that managing of trillion the to for doing considerably excess and XX two and in XX Digital Transformation important positions Enterprise I awareness brand work, in capturing internet quarter Institute, search media and we and evaluating in both comments a lot AI that a and competitor elements few and you for daily. machine in excess our We've the

projects research of way the to University to quarter Institute. the techniques continue UC invest platform a our In advance groundbreaking University efficiency and support Carnegie-Mellon, Sweden the Transformation Stanford, at Digital economy. efficiency University focusing first funded with carbon We cash of Chicago the Partnerships Berkeley, Princeton, to new AI CX lead and important to getting announced Urbana-Champaign, higher $X.X million XX AI MIT, and the developing KTH CX and we energy lower and the Illinois using in of awards the initial in

sales the company. lot We have and been leadership of doing focusing and work in really a in leadership

organizations. for service Alkharrat, and expansion bright experienced added highly I Sam served customer Importantly, quarter, Senior billion teams. from of SAP. you experienced I'm effective President be Officer can President a be see And as positions the sales of they or to quarter Vice was that long we're and Head the number Sam customer Sales and VMware, managing the received with and to roughly net AI employment to and people service With just business. an the get. universities we continues sales shy software employees. not, we in of XXX Global lead X,XXX, track SAP a that with ended fortunate And work first are on ranked Glassdoor. Chief AI by record is to In added global okay. it as capital addition organizations executive and the human as full-time sorry, proven of capital, held amongst employees Tanzu and portfolio new previously the of X,XXX VMware, prior applications, and and of the former Senior a we And of from people globally. from the places X,XXX We other best Revenue applications in as Sam had Executive XX sales able CX that of CX as human internet, interviewed Sam quality extraordinarily VMware track with to a at and world just dollar building Executive think leading to believe continue

application growing. summary, accelerating rapidly software across is in our in AI see industries, market geographies interest market Enterprise applications and segments. the So, We

leadership our along technology the We market are partner ecosystem and ecosystem. that distribution capacity and expand aggressively product comes our investing to extend with our associated to

a color for company on Bottom position now during objective execute positioned IPO high-value to delivering positioned in during line, are a turn the the in strong before global that globally. establishing track IPO and board AI the out first software to is outcomes two company and our software. quarter position this believe AI the the for I'll next we past David has was CFO, as and well Overall, on plan increasingly continue performance exactly I continued you this updated of I we're the in growth the Enterprise accelerating achieve planning our across we its progress the in quarters. establish year would leadership to and customers, application for never for As better the our in growth say, year. of with laid been more to clear over leadership the Enterprise market quarter. David? Barter application we in

David Barter

an of Revenue the meaningful with million, Professional $X.X million, from Tom. year-over-year. level subscription year-over-year. increase and XX% percentage fourth the and delivered guidance. contractual a our $XX.X revenue QX. healthy coverage million. year-over-year. an This quarter. revenue profitability This from XX% the Subscription in was points XX% first substantial us was our revenue We growth It in you, We increase total revenue in quarter that is Thank revenue increase it increase and growth of revenue XX% revenue six with an strong ambitions. the quarter of quarter another of performance provides represented supports a was $XX.X grew QX represents with services Subscription backlog. ended exceeded of

to to XX% high revenue our continue trend the expect of in range. subscription We mix

Geographically, was services diversification grew each strength highlighted our revenue of over the broad-based growth industry improved. which revenue XX% quarter. continued this Our Five revenue industry diversification in financial XX% year-over-year. verticals. vertical, by includes also and our This industry our contributed verticals

$XXX During From GAAP up XX% year backlog and XX from from in an RPO, We an million, When our and current EMEA with represented million, million, recognize an ended million XX% revenue. combined ended $XX.X the next increase we over $XXX.X with a total additional grew which with RPO year-over-year XX% X% perspective, of from ago. non-GAAP quarter, first contracts our customers quarter APAC of was performance XX% right. remaining of year backlog over we revenue the the with the of year-over-year quarter cancellation a expect from in ago. the increase were RPO, months and a $XXX.X to obligations

RPO revenue I Baker have does As any does first the first last the note $XX.X the an in that existing contract. associated The non-GAAP Hughes include quarter commitment not customer not Hughes, Baker an our with additional was at with up $XXX.X backlog year-over-year. of from Baker million In partnership our the end XX% million, Hughes of represented quarter backlog. quarter, and total

related a revenue amount As as quarter. end a portion was they party or where in customer to as reminder, with is related of million a relates directly party The the first included Hughes revenue revenue Baker revenue contracted customer. total where Hughes the this reported $XX.X Baker in

provided release. million to loss quarter of million The was expansion reconciliation million will a tax a drive were better loss $XX.X guidance the subscriptions. This was XX%, to planned the to when margin with strategic expense, to first illustrates be growth million quarter first model. XXX margin XX.X%. QX and Turning was our The A an Operating ago metrics, press operating expansion compares profitability. Operating payroll I up our million. $XX.X to from stock-based our expenses referring reflecting in margin year compensation Gross the $XX.X favorably of and of by XX.X%. excludes our is gross year earnings year persistent operating generated GAAP to our portion was non-GAAP margin expenses QX non-GAAP transactions. stock the ago. expense than it of was leverage investments to to ago, strong which long-term margin $XX when employer a related and basis points compared $XX reflects in the Subscription and XX.X% in growth.

in headcount We accelerate programs continue invest our thoughtfully revenue to and to growth.

positive a XX% of closed in nicely to quarter. Deferred first year. revenue to our from revenue typical grew for quarter. We and investments. of structure note built confidence very was and led We remainder It's a two flow quarter, less our flow capital the for on equivalents a than expenditures of to the flows. the deferred very All-in-all, the and balance and cash, $X cash million that included the billion and fourth sheet important quarter $X.XX cash breakeven the cash in to healthy free first billing terms deals the million, generated Turning our cash with in million with $X QX strong ended quarter fourth $XX.X quarter that supports operating year. of

we in for second the quarter million, mix fiscal to in in QX, fiscal revenue from continue Turning growth and total of In to to year. XX% growth high the range. XX% $XX prior line quarter representing the of and the subscription and expect $XX to anticipate acceleration top guidance full revenue We first year. our range XX% million an will trend

growth make million. to $XX anticipate investments the loss to in operating million a expect of We range $XX non-GAAP and

call. today's customers a to about believe and that results were and opportunity above from our with our continue you quarter anticipate $XXX For of to year million demand term. in growth of range the over increasing solutions accelerate the our the first To to the full we healthy growth who $XXX revenue non-GAAP coupled to balance deploying on expect In to with we thoughtful we our are the long penetrate to sales economic for XXXX, year. optimistic a XX% in operating substantial representing delivered loss million focus significant our range making XX% for million. ability oriented realize very $XXX of over the growth, benefits guidance investments well we million, fiscal positioned activity. meet We joining summary, technology $XXX the remain of Thank

for the the Operator? over call operator questions. to Now I'll turn

Operator

Your line Instructions] comes first Michael question Turits KeyBanc. from from [Operator of the

Your line is open.

Michael Turits

people, market you you've rate adding sounds get progress Machina TCO to actually Ex about ask wanted but the you're made with like I doing to get and me. much run to to bit you diversification little there about good little more also? Can you discussed, talk you reducing what about you're on you bit there, Tom making of and the you a down how and are business, TCV a yourself more partnerships excuse progress talked

Tom Siebel

you, Michael. Thank

saw we revenue seeing our than and of I seeing think We're case applications dramatic versus in a sell the does. of mix a lot platform software our less easy -- component as for increase. we're really a the money application substantially the increase platform

move couple bringing a in moving big quarter that's Ex a last and Machina contributor. the big numbers. expect I What that mostly but making ago and and substantially needle come positive TCV getting towards kick tissue a next the the of of it's would the down $X.X this come TCV on into to was is $XX I think So really average million fourth applications. was down quarter to year that's years against and down contribution But year is it, million. see

good So we're progress. making

Michael Turits

comments then of Tom. the a always And Thanks, Dave on Great. calculation. couple fascinating RPO

sequentially, So But add one total piece, sequentially, I mostly it's looked that RPO, adjusted the it the government. up was did slightly like which the also. I pieces if together GAAP all just declined RPO that think cancelable was and the

components and of RPO? those can on you the and So different about takes talk puts

Tom Siebel

for your question. Absolutely, thank you and Michael,

our its detailed with increased we XX%. think carved deals about right is why flexibility of with the we our because provide the it measured, which and GAAP RPO, GAAP a which we When that right. so that you find You're literature portion that gets we non-GAAP include is do out RPO and structuring cancelable

Hughes of component, terms a that's RPO, five-year might the you includes commitment. which adjusted remember Baker In the

over why RPO. you it you've the signed got is When and is increasing. the not then first it when about think step-up So that time, which amortizes adjusted

of RPO non-GAAP activity. really our reflective the look should you the measure, So is because at it's commercial

Michael Turits

contracts? -- they did. like up math, sorry This is that does interrupt, up that, looks if the that And I cancelable the government strong then XX, really it cancelable but Right. some do expressive to went piece, piece I'm nicely from I sequentially XX, to the

Tom Siebel

it's those are Hi, where those No, exclusively Michael. almost are on Tom. non-government.

definition is duration, So XX for okay. irrevocable by contracted the months nonrefundable of multi-years all government parks months this kind in only the time. it's Even funded at XX a if

corporation we first the do so transactions with always the they not private right after where deals to cancel. So end well it's year, to the make the five-year have can where then three if first satisfied are you a that going we cancelable And be or or tend at be incentive of the every four large year. customers have certain that sure sector

no public sector almost there's I so think. And

Michael Turits

Okay. Thanks, Tom. Thanks, David.

Tom Siebel

a raised you federal When signing above point. Michael and over And great number. this multi-year we're that's contracts,

that's and not all. adequate that's recorded at here So

a work. way And federal GSA agreements that of actually quite where the because so done we those few the a those and multi-year contracts

We that all. have reported at

be would of we that So top that anything reported. on

Operator

Your question next of Murphy Mark line the JPMorgan. from comes from

open. is line Your

Mark Murphy

you thank my I'll add much, and very Yes, congrats.

private aware So appeal Tom you're little think some I machine it more Google ways? pipes, different they I'm to wanted There verticals about customer more is I Cloud that can are traffic. certain Cloud the to relationship expecting gets that a demanding of architecture. we're ask wondering cable more models has whether points need just of the and type learning to platform a It more different in Google maybe absorb because that is maybe different local or if presence. you a a just larger

Tom Siebel

really Well you as Crane way aware. nature big the well Google a this of changed you're Thomas know has in Cloud

a a concerted made market think different, women. is XXX just a and the enterprise Thomas X,XXX from of of in of I experienced decision very the maybe much to gone sales different and that salespeople are of salespeople they've think way. purchase a salespeople today men Their who are ago middleware decision these couple years focus very on enterprise. it's don't of I kind it's quarter has kind

argued I'm seconds argument go the other not So speeds CPU successfully don't feeds, what They it's than other rather that based superior know, technically compete and maybe have sell and made an a qualified. I rather storage to is and decision. hours than and applications. they do into they hyperscalers people, based really and won't upon rather But I have okay. compete going upon They're they too, than to which

they're to be this stochastic you have the selling laundering, as risk. fortunate unique selling chain. effort. very to They're supply of it anti-money be that that's with be this solutions to and how and they going network fraud how is we're they're supply position give positioning hyperscale what just So their everybody a turnkey that the selling kind going else hyperscale of They'll optimization and that decided CPU detection, turnkey company the in market of partner applications in where us us With market, is selling okay. seconds. selling We're in deliver they're

when Now but and is a the they're the I think of at. but take I -- applications result and it's they it's do hours hyperscale seeing a storage a to consume nothing net we're changing CPU up dynamic seconds look in running these that market want

on. I think going what's that's

Mark Murphy

the worth $XXX regarding And clarify a or a as in comment you follow-up. and all is of relationship to-date, that RPO other you systems case deployments to if $XXX of with product on just clarify. any could the running was that that Dynamics use Azure. can great the reference David CX sitting And or is million obviously is over closed then mentioned Tom, that that's accomplishment. the you Okay, deals CRM are balance? just I specific wondering maybe There Microsoft And million understood. you've a quick Is that a

Tom Siebel

component all is specifically advantage is is. it we a CRM supportive of okay. going of of CRM not chain, are sitting it okay. applications, I are it of make been is of very They it This and It's applications, take stuffing, can where in resources. our great and Azure If application Most these is partner, full maintenance. most small it federal the to of RPO. well all and support commercial is. to enormously sure mark, support Azure, supply bread has really Microsoft are butter it these a Some predictive is

Operator

of Morgan the comes Stanley. question Sanjit from from line Singh next Your

open. is line Your

Sanjit Singh

as Thank because imply taking of What focused shift application. the towards if questions. you in shifts of terms this growth an CX.ai with towards the look for the growth, in kind your, Tom the I revenue does RPO of more strategy sort of sort suite is of in versus 'XXs. business we future converge at should the versus application sort think that you're over number to of on XX% the of RPO the mean that up that I sales growth applications in of your Does growth see the solidly plus seeing? growth really high sort in on applications time

Tom Siebel

We're kind Okay. there's keep up here quite I asked that of kind with. can't some analysts keep of

Okay, new. is but applications all, on our emphasis Sanjit let here this, first of all change so me not There is no at okay.

So selling. we've have services companies, the will you gas I utilities, for recall applications. I with roadshow. manufacturing and during companies, IPO mean Applications leading oil been was financial companies what you.

what just no tell a can change kind wish hard is sellings There wants expect okay. I you of bode with versus around us. both and and quarters well in But and in we data a to always part certainly kind Google's applications that. applications the part that of we sell we jumps very the happens of market the it's but Got this change this our We're coming platform sell be quarter-to-quarter, question I going platform And it look applications part, applications. give the of we're forward, you guys so some We could of took anticipation whatever and there's no going change to okay. and sell we emphasis. in at to yesterday in guidance, led and for just on to in there from is emphasis quarter

Sanjit Singh

and partnership. there about opportunities. new a the Is customers on question Tom. about How a is of XX Cloud Makes today think overlap this as your should Any certain CX between of the Maybe the percentage base? total that for of the sense sense, Google customers what within XX that customer Google Google you we that net enterprise are have customers. or current sort follow-up is going or

Tom Siebel

number say, existing Google, of AWS in three know, segment Google are far relatively customers. most to but rapidly a small, is growing. customers a very as by they are the would small Azure, our market and I Yeah, the you

so to this on others closing new really say them accounts Telekom net a Deutsche my applications customers very from and us. is consume and provide it's they've large commitments on and And they're the Google. perspective a a and the for the some they to you focus -- like and is on customers customers new this can Walmart net want made focus both From focus

Operator

of the of Your Bank America. comes Sills from Brad next line from question

Your line is open.

Adam Bergere

too. This is Adam quarter Congrats the on on for Brad.

can partnership So you constel. eco in terms also just expectations guys you share the have on the of any

You is new now, mentioned more do thinking I that applications expected the of about on the benefits the should the net guess that the to you or provide, be benefit partnership? how just the within applications suite towards guys or you but we focus towards

Tom Siebel

been We'll who we've Google Enslin runs sales and the are here leading, at sales who person runs working on first be from of and SAP. Sam Rob all, for the this the Alkharrat guy colleagues

aligning well strategic geographies across the been these sales on industries, target each other So know and really focusing accounts. of and organization we've across guys working on

to and with sell it point the that this want in is Google's financial getting leading might be pretty sure certainly most service sell an but inflection this with market. will is bag well be So -- license we're institutions will will companies will where to be orchestrated the available or large in automotive applications, you hyperscale Absolutely platform. or a large and it this we them, but we

Adam Bergere

the guys a provide then commentary any prepared of the just services the kind follow-up. out? you some of call on Is there can financial as entire in out called to or remarks [indiscernible] you And

Tom Siebel

we're on Adam. distribution. think data I our on having Hold

right this I think here. actually data I have

a It's second. pretty highly me give Just diverse.

well ago, diversified manufacturing, defense, telecommunications, not and gas. XXX% Yeah, it's can't life by way. got something used across here, services, high-tech are to it I see do too oil I aerospace it's share science, and pretty don't I the here. long long What percentages. So a highly but financial percentages utilities, be was utilities, what have

sciences, X% XX% aerospace. making looking X% utilities, and XX% into are now oil XX% it we we're -- just started X% gas, so what Okay, life X% and inroads manufacturing, high-tech is roughly then aerospace,

So like that's looks it what today.

Operator

comes line from question next Canaccord. DJ from Your the Hynes of

open. Your is line

DJ Hynes

this like the CRM ask even I interestingly CRM. platform I'm the installed talk an with helpful? SI commentary side, CRM about seeing be that you're any mean curious is seeing activity you you're in partner can to there with, suggest just on to maybe I about would traction there, seem uptick and what there color the Tom, quarter want more any particular

Tom Siebel

installed trillion wants go everybody it, Well it's can $X.X it do had but can the is two than ways And okay. not, on or and can There's quite predictive, and you two be ways CRM that, it's doing go add do to it. base predictive you kind to of and top less way of into market. math, everybody you to replace wants large, rip okay no guys to the

three and oil is it to corn aggregate data analyst it any installs beans NLP that going it you share in it our aggregate revenue you data, record unemployment as CRM that reports market, Viva, of or can transportation and want there Siebel, for on news, way top orders top sits on build what product then a industry going precise that and on data and quickly, on models very with media, of it's in like those annual revenue four of system the all these Jet of of on financial of transportation, weather have NLP through we rates, statements. have very But relates more So when works have top that us, a prediction, NLP top in prices, And running customer it's of on to about data econometric on to NLP or data stock dynamics, okay. we on forecasting, be the SAP, growth sales rain social machine A. aggregate magnitude ag just it's are those on and you're data learning aggregate forecasting allows the it some may rates, to you commodity and we GDP reports, prices other top be for and travel maybe and on gas, you. churn product

of they So all place might these pretty we amongst And know Siebel partner that opportunity lot upgrade well. this guys an recall put the Systems, same applications. see are seeing that in we we their a to as interest of you existing ecosystem

business SAP, And and customers. to and eye an your provides value integrators going almost an Salesforce, keep for Dynamics, I we're to business with guess So DJ. not big that be quickly doing and on this complementary the is entirely they want way what think to generate us. we're now a in go customers be This to their systems to where really going space and gives is a it I Siebel, opportunity the

you'll I'm think quite have you to CRM. bigger it But re-invaded to it personally relates been, been be been I that on going going to impressed. fundamentally this And And working I okay, business we this going have the pre-announce and now, human model when and okay. see than I be computer And it's, You're on thought. as interaction this we working is a reinvented, also see I've we've to hard. really it, have not

DJ Hynes

a to that, rate current David RPO? as sounds growth interesting. for you. Yeah, you forward non-GAAP follow-up look to a have Do

David Barter

I don't the of current non-GAAP have RPO. a breakout

DJ Hynes

Okay. portion, RPO. It is non-GAAP contributing cancelable is multi-year seems that to backlog increasingly like by which nature

So some a view point. get it would helpful at that of be to

jump I'll the So thank you back in queue. guys.

Tom Siebel

Thank you.

Operator

question The Deutsche of from next the from comes Colville Bank. line Patrick

Your open. line is

Unidentified Analyst

This on is Congrats Dan Patrick. for the quarter. on

with I actually or would makes is businesses and like customers size a you're You two-part. my still I leading to more that smaller is kind guys applications response is, on platform, question of across of sense. because said it in more traction earlier guess the that guess the declining average smaller question is is to be that selling contract lot that One has apps businesses to mean you in toward in selling guess then of I in primarily to it's that I very kind any at buying can or another to applications deals strategy. on, question, large that more mentioned enterprise change And not going kind you there comment more are you lead that move response said any been all. the that of down-market two

if comment shift? you're could you I you. So seeing why you kind of that think wonder Thank

Tom Siebel

shift? seeing we're Where what

Unidentified Analyst

A I of customer. and more less the shift Smaller application guess toward platform?

Tom Siebel

was always solving laundering, a what way, problem cycle the optimization, we business And a that's solving an the way problem a We're I lead for lead $X.X supply the the chain, always All business management, sell an begins. applications. application. with is whether it's Well, application price cash sales customer application might year. that's the list there churn. might be mean like million cash anti-money with

or three happens then want or might that the license. is the a we applications in two other side they and involved get and pilot they one Now what

I think our average contract.

I is disclosed think something, okay, this a of something, plus XX minus we've quarter by or months or okay.

applications or So want finding for one license they also then platform want they to the platform they or XX then license two the and XX in three XX developers. they of sometimes build the and or to say course

years. So this is multiple

$X.X So that transaction into a like with to $XX. turns out started as was that going be a million

how So happens. this it is

at So we buy them however, to did what, let wants the customer happen it.

businesses call Skillion, it wasn't small standards sell America. like Dust. used question a by Now to would customer it. rather okay. We yes our about are selling ABC list we that Morsco, companies Spearstone, of Shell, it yes, Ball, places wasn't here But on smaller there only we We And have the relatively like no is to CerebralEdge, are, here absolutely someplace. There's be customers. we them, didn't Bank

seeing business at pretty hunting hunting hunting, we're elephant hunting but and elephant a squirrel scale. so now big and just not, in And way we absolutely used and global to that we're of we're the we're we're be deer in out

Operator

comes Your from Jack Needham. of next from line Andrews the question

Your is open. line

Jack Andrews

Good for afternoon my and thanks taking question.

and with other technology of maybe feel Microsoft of that light Snowflake. are versus terms Could in view as just type just what vendors you you you allies potentially us and you types for the have natural competitive? Google you update like announcement other companies in of more Just relationships do

Tom Siebel

would hyperscalers. like Well a be Natural allies would certainly platform-independent, componentry complimentary make people and system, natural lot storage certainly a who of allies makes the us. be all that's Snowflake

companies like HXO, we AI like have compete like we ML. partner auto who I partner that think we with mean Robot. products with I make, Data us with

auto to their can use we our many robots as Robot of Shell partner with Data get I and auto think people Databricks use ML they our ML. or Databricks. and customers to

So we partner with them.

of are providers Okay. they partners. do do do. component the The, competitor they what the science don't they don't real think individually one distribution potential you want million like I I know, components think we channels, So no, multi-hundred I look dollar aggregate Jack that in this decides multi-year and are all themselves to where build those organization the kind project these projects. IT in of

All years. down come of to which after a seem crashing few

then or because wants have burn got the new out, like have just and to one it's done the impossible, every real herself just the run to And competitors guess and it's of it's technology. who so, CIO part succeed course the we him process we've virtually build we after yeah, bail going through come and for crash after they process and them of it they're customers, in that and -- virtually I its they at a our natural get to just let

Jack Andrews

balance or do still in about a you're Thanks. that important any could accelerate doing curious, sort when potentially just you technology-related on contemplating follow-up, the think appreciate front just we it's I'm the as development your that sheet. quick product on things internally? feel to I context, keep the cash and of are when you developing M&A

Tom Siebel

are the no It's a great we make question organically, on okay. growing focused mistake, business and

us So growing might organically default would it business because really charge unique send nobody in you Yes, can involved no see if something M&A the we if of there answer that of distraction. in something is for bankers on equation we even for own we part when a there us because might, before easy as okay. complements big M&A there. But don't them we focused see that, M&A M&A our buy see that be think we're the really the actual technology the as we we here would and piece I say the technology of make a sense that to stack read us the

I think our we to okay. knitting, stick

continue We customers to continue grow our to move the continue to footprint, product customer successful. the make base,

fine. is work just think I out to everything going

Operator

JMP. from Pat of comes Walravens Your from the question line next

is open. line Your

Patrick Walravens

And Defense thing, of ago weeks June in for Defense Department Great, data Defense acceleration obviously missile the in question talking on for that's you I and Kathleen and a opportunity had CX your careful and that Hicks the look website okay. I about have is do what's the to where was to and you on Admiral for press one the go about have realize of have if Vice you. looks Department two David, thank initiatives. you all Tom had and AI one release testing say, big you but be you, but for she first, which like I similar. the ask some Tom Deputy that Secretary talking Federal as defense what

a lot of that is So already. publicly it seems like out there

you great? can would whatever the for what So say looks CX about be opportunity like

Tom Siebel

Brose. That's It's just interesting you Chain okay. written endless. big there is, know from you Pat, it is a Kill And really to there staggering, Christian The how by it's name book me called out

from how the and into all nature back to like fits thinking warfare whole of Amazon kind changing of will XX of don't are these give I you it of where If measures, enable AI they're AI and AI the you bucks us China about and between how the level staff all get this, and of everything. leaders going to the is but about you all is

brought in. business a wonder the is this is Ed Federal Chairman the Ed of balance. around that the opportunity formerly General as Cyber Command. So we Systems. is almost that of Cardon He one reasons without U.S. I Cardon

Nakasone, And the We're we government. we lot extent the in knows so and Command the to so. and the the States Paul to do I serve opportunity privileged of And the was think and to he Pentagon. that so have that runs Paul that who United time spend guys and of all these a Deputy do NSA Cyber so his

of we're think Ed General in involved today of addition I Weber recently a We that we Todd brought there. to the in time know Manager XX Federal. Cardon, projects as we lot about and CX invest on

that role in expanding war the is that. for us on war, so States is and we United there's scary. business So actually we and to the And in think between opportunity think we play to and going lose well, China story not an that big are market end AI. we going If a that and is

had a for question David? You

Patrick Walravens

Yeah, thank for that. you

David, and it's so, thing X%, that you look think is this now I I grew the down grew the stock one aftermarket, you you XX%, is you quarter if like confusing at think quarter know, And in last XX%.

try if So to guide XX% quarter generally guiding you midpoint I'm people beat just math people then deceleration to the next and right, then doing the usually acceleration. acceleration guys my guided like the and growth it, are for you

the that but around normally billings really be RPO and well the received, it's are would so So bouncing confusing. much that

for decelerated and help helpful? bookings be revenue why any you provide revenue this can think clarity metrics yet should is last why accelerating would So quarter and I confidence the really acceleration that we have in

Tom Siebel

Tom. doing in lumpiness deals. There is big This is the still Pat. bookings, still We're

they used While some QX bottom is as we've in and deals big QX. as lumpiness we but the be, had not there to and line is it, got into still

that? I so but to I that have David, place bookings, want the get you still to to mechanisms of there's we anything them in And out there. do lumpiness there's do, add still believe

David Barter

it covered you've think well, I Tom.

Patrick Walravens

you. thank Okay,

Operator

are I remarks. over the time. for at no closing questions the to the like Mr. Tom back call there now Siebel this line further turn Sir? And phone would to

Tom Siebel

your will next forward you and time the of when Okay. thank Ladies at update of see happens and questions give to look on or the time. whichever We appreciate we first. gentlemen end you all an we you the business quarter, for your your and

and thank you. day great a everybody have So

Operator

Ladies for participating. gentlemen you thank and we all call conference today's concludes this and

may now You disconnect.

C3.ai (AI) 2 Sep 212022 Q1 Earnings call transcript